Thinking about how to invest in real estate? While real estate market conditions persist with low interest rates and high demand for rentals, it’s a good bet that there’s still an opportunity to profit from investment. If you’ve been doing some initial research on the how-tos, it’s likely you’ve seen discussions about two essential approaches on how to invest in real estate.

One approach is to buy shares in a real estate investment trust (REIT), but I won’t dwell on the how-tos because the dynamics are so different from direct ownership. It involves buying shares of a portfolio of properties, and the performance of the fund is based on both cash flow and gains from selling properties. I mention this just so you know it’s an option, but what really got me excited about learning how to invest in real estate, is the opportunity to build my own portfolio of properties, and, in so doing, to build a solid foundation for immediate cash flow and future income.

Direct real estate ownership: Unlike investing in an REIT, direct ownership is anything but a passive investment. It offers real rewards, as well as risks, but careful planning and building a thoughtful strategy will create a successful platform for how to invest in real estate.

So let’s get into it the first how-to: Like I said, you need to have a strategy and a plan. Let’s start with planning basics for how to invest in real estate. This is something I cover in depth in my how-to guide on business plan basics - you can check it out yourself. The basic components of a good plan are:

• Your revenue goal: Start with your current expenses to define how much cash flow you need to generate and use that as your initial investment revenue goal
• How many “doors”: Define how many properties you need to acquire to help you meet your revenue target (and, hence, the name of our site!)
• Where and what: Determine what type of properties you want to buy and find favorable rental markets to shop for them
• Execute. Because a good plan for how to invest in real estate today is better than a perfect plan tomorrow.

Get the details on each how-to step here.

Once you know what you need to do, how do you go about it? Develop your strategy. Like an artist with a palette of colors to choose from, you’ll find, as a real estate investor, that you’ve got more choices than you can shake a stick at. That’s good, because that’s how you customize your real estate investments to your needs. It’s also bad, only because the choices can be confusing. Once again, I can help with some explanations on how to invest in real estate, based on your choices:

These are some of the many strategies available to you, and you’ll hear other investors discuss how to invest with these strategies, too:

• Sweet Single Family Homes! They have a huge resale audience and appreciation potential
• Move with the Multi Family! Love the economies of scale and the higher returns
• Shop for Short Sales! You get great deals and big returns
• Fabulous Flipping! Go get quick and meaningful returns

Find 4 more strategies in Real Estate Basics

No matter what direction you decide to take, take into account that your plan needs to mirror your appetite for risk, available funds, time horizons and more. For example, think about where your relatives live, and whether you could get a tax write-off just for making your a family visit! Remember: Fail to plan, and you’ll plan to fail! Take some time to consider the pros and cons of each investment strategy in our FREE real estate investor strategy mini guide - just one example of the resources we provide to help you understand how to invest in real estate.

More how-tos for success:

• Make sure you really understand what is real estate investment
• Learn how to answer anyone who asks “Is real estate a good investment?”
• Get familiar with the four steps to get started so you know how to be a real estate investor
• Learn the best places to invest in real estate and why
• Find out whether foreclosures make the best real estate investments
• Learn what HowManyDoors offers that makes it different from other real estate investment programs